The fabrication of gold nanodots by stencil lithography and its application for optical biosensing based on localized surface plasmon resonance are presented. Arrays of 50-200 nm wide nanodots with different spacing of 50-300 nm are fabricated without any resist, etching, or lift-off process. The dimensions and morphology of the nanodots were characterized by scanning electron and atomic force microscopy. The fabricated nanodots showed localized surface plasmon resonance in their extinction spectra in the visible range. The resonance wavelength depends on the periodicity and dimensions of the nanodots. Bulk refractive index measurements and model biosensing of streptavidin were successfully performed based on the plasmon resonance shift induced by local refractive index change when biomolecules are adsorbed on the nanodots. These results demonstrate the potential of stencil lithography for the realization of plasmon-based biosensing devices.